Thursday, October 14, 2004

Story Problem

Jerry is paid 15 million dollars a year, not including unexercised stock options. Bob earns $12 an hour and works 40 hours a week, which really means 45 hours counting the unpaid hours he spends working off the clock. If Bob works 50 weeks a year and Jerry works 40 weeks a year, how many hours does it take Jerry to earn Bob’s annual salary?

(Answer: Divide 15 million by 40 and you find that Jerry makes $375,000 per week. If he works real hard, say 50 hours a week, he makes $7500 an hour. Getting paid for 40 hours, Bob makes $480 a week; times 50 weeks a year that equals $24,000 a year. So, it takes Jerry three hours and ten minutes to earn what Bob earns in a year.)

Next weeks assignment: If he puts aside 5% of his salary every fifteen minutes, how long does it take Jerry to own Bob?